Ricci/Rossi coming back to FLOPS?!

[gunfyter]

She has a point Publishers.... You were wrong about NJ before 2005.

But I think you are right that the biz plan of NJ is different than what others are trying to do.

I am not sure what FLOPS is trying to do... since they are no longer a manufacturer owned company like FLEX and CS.

 

[AeroBoy]

She has a point
I am not sure what FLOPS is trying to do... since they are no longer a manufacturer owned company like FLEX and CS.

Flight Options management reminds me of The Puppy That Lost His Way.

 

[Publishers]

Gunfyer, I may or may not have been wrong. We really will not know that for a few years, hence my comments about business being a longer term thing. The hard part about NJ is really determining what the profit centers are and how they produce with all the symbiotic relationships like FSI. If I have underetimated anything, it is the amount of individual wealth created in the last 10 years, and, the great marketing job the airlines have done for corporate jet travel. My concern with NJ economics was the need to consistently sell more aircraft positions, and, residual values of what they have. Foreign demand has changed some of that and is keeping the used market up. Just now is there a softening of values and time on market. The value of the dollar gave not only NJ Europe a boast but also the used market. In the end, this is the part that has to go right for NJ not so much operations.
Flops had a plan that really has hit the can. If they buy a bunch of Phenoms from Embraer, they just become another Citation Shares wannabe. Buffett also has the brains and money to buy into the snyergistic ops like FSI.
NJW has that great big organization type thinking. She says that I concentrate on the business side. Well she is right. If you do not solve that part, there is little demand for employees or no longevity for the ones you have. The blunt fact is that EJA failed on every level that one could look at. It used to be an economic disaster area when it was under the railroad. Only the change in model to NJ allowed it to survive. These other moves are keeping it going. As I said, it is a tough playing field and the others survive because they are part of big organizations that have other missions. FLOPS unfortunately is not in that position unless they are an Embraer outlet in teh future.

 

[netjetwife]

....If I have underetimated anything, it is the amount of individual wealth created in the last 10 years, I don't know how you missed that. Plenty of experts kept reporting it. It was one of the common sense reasons the money was there for NJA to be profitable and pay the pilots a professional salary. It was also reported that business/private flying was growing rapidly. and the great marketing job the airlines have done for corporate jet travel. I listened to the frac pilots talk about airline service decreasing. Add to that the fact that security restrictions, inconveniences, etc are apparently here to stay and it's easy to see why those who can afford it prefer private travel. .... Buffett also has the brains and money to buy into the snyergistic ops like FSI. Which is why my husband took a chance on NJA even though he was hired during their contract negotiations. I'm confident the experts like WB, Santulli, and Rosenthal can manage the business side of things while the pilots take care of the customers and the NJ Association helps the pilotgroup. If I have questions about the business side of things I ask my husband his opinion. I simply find it hard to trust an outsider who had no problem seeing the NJ pilots being underpaid. NJW has that great big organization type thinking. Ironic comment. Actually, I am usually thinking of camaraderie and fostering a community spirit. She says that I concentrate on the business side. Well she is right. If you do not solve that part, (With all due respect, it's not your job. That said, I can see that the subject does interest you.) there is little demand for employees or no longevity for the ones you have. I see detailed business discussions as the purvey of upper management. Yes, the pilots need to pay attention enough to know that the company they fly for isn't being mismanaged, but otherwise their primary focus should be customer service. All the business theories aside, it still boils down to people. The pilots giving their pax a fantastic flying experience and management keeping the pilots motivated enough to concentrate on the pax without other distractions (namely low pay and unfair work rules) getting in the way. The blunt fact is that EJA failed on every level that one could look at. It used to be an economic disaster area when it was under the railroad. Only the change in model to NJ allowed it to survive. These other moves are keeping it going. I maintain that focusing on the basics listed above made a huge difference to the bottom line in a business with demand for the product/service. As I said, it is a tough playing field and the others survive because they are part of big organizations that have other missions. FLOPS unfortunately is not in that position unless they are an Embraer outlet in teh future.

It doesn't matter how well set up for success a company is if they do badly in the human behavior arena. Out of control egotistical CEOs/upper managers (Boisture as a past example, MS presently) can ruin a company. Labor strife causes high attrition, low morale, and wrecks havoc on a training budget. Unmotivated and/or lazy workers fail to retain customers and growth can slow or worse--shrink.

Business direction, models etc are intangibles beyond our sphere. In contrast, the pilots and their families are directly impacted in many tangible ways by the relationship between the pilots and management. Motivated pilots have no control over the business model, but they do play a huge role in making the company successful through service excellence. Personally, I think the pilots (and their families) are better served by working together on those things that they can change. Plans for concrete improvements are more beneficial for the fractional industry than theoretical business discussions, IMO, particularly when those discussions fail to criticize low pilot wages. NJW

 

[Publishers]

The one thing we share is that WB, Santulli, etc are fantastic managers who have done an outstanding job. Business flying grew at a 10 to 12% rate in 2006 and 2007 and is expected to go back to a more normal 6 to 7% this year. They capitalized on the market. I am certainly not disputing the success or the necessity of having a great realtionship with your core employees or that they cannot have an impact on success. It is easier to do of course when the company is growing, well financed, market leader, etc.. than when it is shrinking, cutting back, and its plan has gone south.
The thing is without those intangible business models, the job your husband has does not exist. If your union leadership had stayed like it was before 1108, you might still be without a contract. The managment of both is key or there is nothing there at all.

 

[netjetwife]

We can use FltOps as an example of a shrinking company. It was/is a human behavior problem. Ego-driven decisions are typically bad ones. The FLOPS refusal to pay the going rate has had dire consequences. Underpaid/overworked pilots have left and those still there are not motivated--understandably. The way to turn that around is to give the pilots a fair contract. Using the current situation as an excuse will only ensure more of the same failure. I'm disappointed that you aren't as bothered by low pay for pilots as the rest of us are. Why don't you discuss that topic more? It certainly is a much more immediate problem within the pilots ability to influence. The chosen business models are not. The thing is those models are already in place and pilots can consider that when they take the job, as my husband did. The relationship is an ongoing thing and negotiations allow direct pilot input. So it seems that should be the main focus of pilot discussions. Do you currently fly, Publishers, or are you in management? On the subject of good leadership we are in complete agreement. I will add that a strong contract can help to shield pilots when management fails to meet the high standards demanded from the pilotgroup.

 

[Publishers]

The FLOPS problem which is still an open issue us whether or not the fractional model created by NJ works with older higher maintenance aircraft with questionable residual values.
As to pilot pay, I think most pilot I know are paid a reasonable wage for what they do. That said, Netjets is such a different animal than other places, it is hard to even equate it.
I have been the founder, manager, and industry supporter of a number of corporate flight departments, 135, and 121 carriers. I have served on a number of the alphabet soup associations, published an aviation employment magazine, and am semi retired and helping various aviation entities. If you are near Columbus, Ohio State has some tremendous AED programs and the one on Human Resource management may be enlightening for you. While there you can debate the merits of a system that makes a pilot with tons of experience start over from scratch with another carrier because his company failed. In addition, find out why legal considerations have kept one aviation company from saying anything negative about an employee and the next company being stuck with the same bad apple. Your husband was an F16 driver, were they the best of the best or just someone who signed into the Air Force first. You are poniticating with a total background of two experiences.

 

[gunfyter]

Conspiracy theory

I suspect the future of FLOPS might be to copy the Flexjet and CS models of being the Aircraft manufacturer's fractional outlet for their business jets ... making a move to the Embraer products....

But the new planes won't hit the streets for some time....

So they would have to mark time while waiting. Did I recently read they have sold no shares this year? Why would they if they plan on a product shift?

Actually I think its a good plan.

 

[Publishers]

That is about the only plan they can pursue right now even without a current product (Embraer). The fractional concept utilizes aircraft so highly, the pressure is on maintenance and older aircraft just have a hard time with it. Secondly you need to keep your number of models down, especially when you start. Third, it is necessary to have a cozy relationship with a manufacturer like NJ did with Cessna for parts and service support. Lastly, the Embraer product is on the smaller end at the moment and has more potential for customers than say BBJ's. In short, they need to start over with a new plan, convince the pilots they have one and it can work, and lastly implement it in a way they can have a niche.

 

[ProFracPilot]

In short, they need to start over with a new plan, convince the pilots they have one and it can work, and lastly implement it in a way they can have a niche.

You've hit the nail on the head, Publishers.

The complete void of leadership and vision has been dumbfounding under Nahill and Sheeringa. There has been no corporate vision in upper management since Ricci left. Say what you will about his business management skills, the man's entrepenurial spirit provided vision for the fledgling Flight Options organization. The original model was built on a sale of shares platform with no real thought given to attaining or maintaining operational profitability under high maintenance costs of "previously enjoyed" aircraft. Perhaps the thought in the early years was that they would enjoy a longer time frame before being forced to achieve operational profitability - then 9/11 and the down markets of 2002 intervened. The "previously enjoyed" aircraft model certainly put Flight Options at a disadvantage when it came to controlling operational costs. But the truth is all the fractionals have scrambled to attain operational profitability.

I'm hopeful that Ricci's purpose in returning is to provide a new vision to Flight Options, one that is guided by H.I.G.'s business acumen. If this is the plan, and they sell it (along with delivering a fair contract) to the pilot group, they'll get the support they need.